The Interloop
An Introduction to the Cycle of Emergent Value
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By David Rygiol
Edited by Nina Rygiol, Tara Nesbitt & Justin Trusty
Published 12/1/20
Updated 1/22/21
Prelude
Your data is a terrible confidant. In fact, it betrays every secret detail of your life: what you purchase, what you owe, your political affiliations, search history, playlists, favorite shows, frequent contacts, infrequent contacts, email subscriptions, driving history. It can even model your brain and anticipate your thoughts and desires.
In 1803, France sold a massive slice of North America to the United States. At the time, France seemed to have the better end of the deal, trading a distant wilderness inhabited by nations of indigenous people for an influx of hard currency. However the deal gave the United States the means to grow from a scrappy country into a powerhouse on the global stage. France neglected a fundamental reality of the time: land equals power.
The Louisiana Purchase often feels like a story in a children’s book. It is taught in every grade school across the country as the window of opportunity to westward expansion. It calls to mind covered wagons on the Oregon Trail and the grit of early settlers. However, the basic events of the transaction remain relevant today: a resource is taken with little or no exchange in value and used to make the new owner rich.
The land rush of 200 years ago is playing out again today on the digital landscape. Tech companies settle into people’s online lives and extract their data and attention to grow their market and influence. After centuries of the same pattern, it’s time to put value into the communities that own the information to begin with.
The following five points outline our observations about the economy, our beliefs about the importance of data, and propose a plan to build a brighter future.
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Yesterday’s System Is Failing Us Today
Most of the human species' time on Earth has been defined by the fight for land. We began as small nomadic groups unbounded by place until the agricultural revolution made the possession of land a source of power. Controlling land meant benefiting from its natural resources and, until the 19th century, countries warred and bargained with one another for acres. The Industrial Revolution shifted the power struggle towards the control of production. Corporations battled for machines and manpower, seeking economic dominance which granted them influence over society. The measure of a country's wealth changed from its holdings of domestic and colonial land to its production, or GDP. The invention of transistor technology in the 1940’s ushered in our current era: the Information Age. Today the economy is driven by the pursuit of a new resource, data, and over the next century, whoever controls the most data will wield the most power.
This shift in value from material goods to immaterial data is already affecting traditional markets and devaluing currency. Digital currencies are decentralized methods of transparent exchange that aren't bound by the same power structures as national currencies; some of the most valuable companies in tech are not the most profitable but the most information rich - generating little economic value but stockpiling huge amounts of data. As information continues to eclipse currency in value, power will shift to those who own the data.
Our current economic model is not built to withstand such a dramatic shift away from tangible goods, and the negative consequences of that incapacity will be dramatic. The wealth gap will continue to widen. Extractivism will accelerate to harm everyone but the few who control information, stripping value from local communities. Greed will continue to fuel a perpetually fractured system that leaves most people’s basic needs unmet.
We need a new model for a free market economy that allows all people and businesses to thrive in the information age.
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Data Dummies - Information Ownership, Agency & Equity
The right answer is neither a step back nor a hopeful step along the same tired path. To start building a solution, we need to understand the role of an individual's personal data as a resource.
Every person is unique, beautiful and complex - born with inherent rights to own their information. However in the current system we are continually trading away our data. In fact we are in a very similar moment today as the French were in 1803. Every day we give our data (and it’s abstract value) to tech companies in exchange for services that are essential to modern life. Those tech companies don’t simply sell our data - they create digital models of us - data dummies that they use to test, predict and influence our behaviour. Once these dummies are sufficiently detailed, they sell access to other companies that want to reach us, extracting profit from our information. That system feels so large and opaque that it’s hard to imagine changing it to give individuals ownership of their data. Right now individuals don’t have the option to claim ownership of their existing models, especially if they want to continue using the free services the tech companies provide.
There is, however, a strong reason to hope. Individuals actually have a distinct advantage over their digital copies. Tech companies that collect our data have a lot of information, but they’re only guessing when they build models of us. We know ourselves intimately. Every person has unique, exclusive access to their own information - this is a huge insight advantage over data gathering computers. We can build a new framework that allows people to build digital models of themselves that are more detailed and valuable than the existing ones. This new system would restore ownership over data to each individual by reorienting the permission barrier so that tech companies would need to ask them for usage rights.
Data is different from other resources in one important way - its ownership is indisputable. Possession of land and other tangible resources is contestable, but an individual’s personal information belongs only to them and is clearly identifiable. Even though we daily give access to our data to tech companies, it doesn’t stop being linked to real people.
Like other resources that are extracted out of a community by an outside force, the use of data will most negatively affect people of color. By 2050 the US will be a minority majority and that demographic shift will require businesses to increase marketing to communities of color, using more of their data to do so. Achieving data equity will require a new system that gives each individual total control of their data and it’s value.
We need to democratize the control of data and empower each person to benefit from what belongs uniquely to them.
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Interloop: The Cycle of Emergent Value
To answer these observations, We are introducing a new economic model called the Interloop. Interloop is a verb meaning to loop together. This cyclical system links together three groups: individual consumers, for-profit businesses and nonprofit organizations. Each has a unique motivation that is not fulfilled in the current transactional system. Individuals seek to better the lives of people in their community and retain ownership of their data. Businesses seek to increase profits and build strong relationships with consumers. Nonprofits seek to be more effective at improving the communities they serve. These three groups have roles in the current system but are not strongly connected, missing out on huge potential benefits.
This cycle of emergent value is mutualistic - the actions of each group fulfill the motivations of all three. People provide information to businesses for free that traditionally cost the business money. Businesses honor that value of that information by donating funds to nonprofits. Nonprofits collect this passive income and gain a detailed picture of their supporters, enabling them to be much more effective at improving the lives of people.
We describe the cycle as emergent because the value created at each step is greater than the sum of its individual units if they were exchanged in binary transactions. A business could pay 100 people $10 each for their data, but that money would not amount to meaningful change in the people’s lives. In the cycle, the people allow access to their data for free and the business donates the same $1,000 to a nonprofit which is optimized to make a real impact. The same dollars are more valuable within the cycle. What was once an expense for the business now becomes a tax deductible contribution, increasing profitability.
This economic cycle is powered entirely by the people. They retain power over their data and have agency to decide how it’s used. They can grant or deny access to their data to any business that requests it. Similarly, they can direct value to whichever nonprofits they want to support. If a business or nonprofit acts against the interest of the people, they can be denied access to this critical resource. It’s a capitalistic, free market model that democratizes control to the people and incentivizes businesses to use beneficial practices that don’t prey on human vulnerabilities. The people powering this cycle are motivated by the generous community bonds that have made humans the dominant species on the planet. Our ability to unite and collaborate despite differences is our greatest source of stability and the Interloop encourages strong, authentic relationships.
To be clear, the Interloop is not an assault on tech giants that are getting rich from our data. In fact, the value of our personal information can only be realized because of the systems they pioneered. The Interloop is an opportunity for people to build a true relationship with those businesses, granting access to their data in exchange for value being returned to their communities. This cyclical exchange actually allows businesses to become more profitable without extractionist practices that prey on human vulnerabilities. The by-product of the Interloop are positive externalities that benefit local communities.
It’s easy to look at the current system and think that these companies already have our information and there’s nothing to be done. To the contrary, like the people it represents, data is always changing and businesses need a continual supply. We’re still in the very early days of the information age and it’s the responsibility of each individual to reclaim ownership of their data and its value for the decades to come. One person’s information is inconsequential to global corporations, but a large movement of people liberating their data will persuade businesses to take note and adapt.
Now is the time to redesign our system to better serve ourselves and improve the lives of future generations.
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The Sharing Society
At first glance the Interloop might look like a riff on the Sharing Economy - leveraging a decentralized crowd to fuel a platform that collects profit from many small peer-to-peer interactions. However a more critical look reveals that the Interloop would result in something quite different - a Sharing Society. The difference comes from understanding the difference between market norms and social norms. Market norms and rooted in economics and define the relationship between work and compensation. They motivate people to ask for raises and dissuade people from doing work for little pay. Societal norms are based on shared values and relationships. They’re what keep you from paying your parents after a lavish holiday meal, even though you paid a lot for a similar spread at a fancy restaurant the weekend before.
The Sharing Economy has led to the growth of several valuable tech companies like ride sharing and hospitality platforms. While these companies dramatically shift traditional business structures they are still ruled by market norms. There is a lower limit to how much a person will be paid to drive you to the airport, and also an upper limit to how much you would pay for the ride. Money plays a powerful role in shaping people’s motivations and interactions. In contrast, the Interloop creates a Sharing Society governed by social norms that bind people together. The work of individuals in the Interloop is not linked to any expected compensation, but rather a set of shared values that connect them to the businesses and nonprofits in the cycle. A Sharing Society motivated by values rather than money can capture the same magic of the sharing economy but create a much more stable, equitable and enduring system that allows all people to flourish.
We need to work together to create a shared reality that fosters authentic human connections.
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Progress & Potential
In its simplest form, the Interloop might be found already at work in isolated instances, linking a small community, a single business and a nonprofit together in a virtuous cycle of mutual benefit.
The scale this model can achieve is only limited by the collective will of the people. Imagine your city ten years from today. Nonprofits are the biggest, most influential corporations and society is shaped by the pursuit of shared values rather than personal wealth. They are able to pay employees well and attract top talent. Burnout is a war story swapped between older employees who remember leaner times. Professionals who are undervalued in today's system - teachers, social workers, nurses - gain their deserved level of income and respect. Parents who dedicate their working lives to raising their children are validated by a system that protects their well-being and human dignity. People are more fulfilled doing work they enjoy because they aren’t held subject to providing for their family’s basic needs.
In theory the Interloop is not limited to data and could expand to include anything a business spends money on. Labor is traditionally the biggest expense for a business. Consider this potential future for yourself. All of your basic needs are met by nonprofits in your community so you need very little income to maintain the lifestyle you desire. You work at a job that’s fulfilling for a company that shares equity in its ownership and profits. This works well for you because the company is very profitable.
The role of government in society could also change for the better, even with lost tax revenue from businesses using the Interloop. Since its inception, the primary political debate in the US has been over the size of the federal government. Proponents of big government want to expand its reach to provide for the basic needs of all Americans. Small government advocates argue against overreach into individual liberties and pocketbooks. In a society in which nonprofits meet people’s basic needs, both sides’ desires would be fulfilled and politicians could focus their talent and attention on the government's most important functions: leadership, security and justice. They could work more collaboratively to serve the people, unbound by the fierce economic forces that hold them in conflict today. Our county would enjoy more unity, safety and justice.
It would be easy to brand this imagined future as a utopia - the dream of an insane optimist. Before discounting it, consider this definition of insanity: doing the same thing over and over again and expecting different results. Is giving the broken system another shot more rational than attempting to build something new that could improve the lives of all people?
Human beings have evolved to focus exclusively on the present, discounting the past and future in our decision making. For that reason it’s important to recognize that shifts in our economic systems have repeatedly reshaped society - in fact the current state was shaped by a sequence of far more extreme shifts than the Interloop proposes. From the Agricultural Revolution to the Information Age, every new economic model in history has divided people into classes and distributed power unequally - leaving the less fortunate disadvantaged. The Interloop would be an even tide raising all boats - avoiding the inequities of the past.
The Work of Harmonee
This shift is a great leap that will be made incrementally by the collective will of many individuals - each person that chooses to participate is one more important piece of the cycle. Harmonee is working to build a platform that brings the cycle to as many people as possible through a new survey tool designed to build authentic relationships between people, businesses and nonprofits. We see the urgent need for new tools that enable everyone to listen more effectively and talk a bit less.
Harmonee’s platform is designed to allow individuals to begin the process of building their own digital model that they have full agency and ownership over. Every piece of information that a person adds to their model makes it more valuable - eventually it’s value will eclipse that of the models owned by tech companies. The Interloop allows people to direct the value of their model back into their own community or towards others which they support.
Join Harmonee today and begin reclaiming ownership of your story.
Acknowledgements
The Interloop is not the product of an isolated epiphany - it is an answer to the call from many thought leaders for new systems that account for human dignity in an increasingly disconnected society. Antionette Carroll’s argument that systems can be intentionally redesigned was an important point of early inspiration. All of Yuval Noah Harai’s books laid the anthropological groundwork for the idea. The technology ethics shared by Tristan Harris and the Center for Humane Technology focused the concept on principles that protect humanity. Additional inspiration was found in books and podcasts by Isabel Wilkerson, Henry Timms & Jeremy Heimans, Peter Wohlleben, Ta-Nehisi Coates, David McCullough, Data for Black Lives, Kate Raworth, Ibrim X. Kendi, Walter Johnson, Malcolm Gladwell, Nathaniel Philbrick, Dan Ariely, Guy Raz, Kate Murphy, Reid Hoffman, Batya Friedman & David G. Hendry, Carlo Raveli, Donald Hoffman, John Inazu, Susanna Clarke, Rufus Griscom, Jonathan Gottschall, Adam Grant, Niall Kishtainy, Daniel H. Pink and Christopher Ryan.